I use terminal to show hidden files : defaults write com.apple.finder AppleShowAllFiles TRUE

killall Finder

but how the hell do I create a .htaccess file? Do I create it through TextEdit?

All links work fine using default permalinks but when I change the radio button to postname I get a error 404. Have created a static page for my site and the homepage displays fine but the other links get the 404 error.